Abuse of aid funds denounced

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The Finance Ministry yesterday denounced officials from eight western districts and provinces for illegally using funds the central Government had allocated to relieve poverty.

The condemnation followed an investigation by ministry inspectors in areas including Gansu and Shaanxi provinces between February and April, the People's Daily said.

In one instance, officials in Lanzhou, Gansu province, stole 27.5 million yuan (HK$25.85 million) allocated for a job retraining centre to help laid-off workers. They used the money to build a 19-storey commercial building and a dormitory, as well as buy a car.

A further 21.8 million yuan of poverty funding was illegally made out as loans to 16 provincial government-controlled firms.

Investigators also found that between 1997 and last year, a former poverty relief office chief in Sichuan province embezzled 1.72 million yuan, nearly two-thirds of the funds the provincial government had allocated to help the needy.

He used the money on personal assets, travel and banquets, covering up his crimes with fake receipts and accounts.

In Shaanxi province, the poverty and finance offices were found to have misused 10.87 million yuan allocated by Beijing to relieve poverty in 1999.

The officials are likely to be charged soon. 'The scale of corruption is very wide in these [western] areas,' Jing Xuejing, an economist at the Chinese Academy of Social Sciences' regional economics research unit, said.